Yahoo Wants Back in the Search Game

Yahoo is rumored to be planning a return to the search market, with two projects they hope will get the company back on the map with their own search engine. Yahoo CEO Marissa Mayer has reportedly spearheaded two projects, code-named Fast Break and Curveball, in order to take back Yahoo’s organic and paid search in-house.

Right now, Yahoo has a long-term search and advertising contract with Microsoft’s Bing, which provides Yahoo’s organic search results and related search advertising. The contract was renewed last year, but Mayer was reportedly not happy about it.

The current one-year contract will expire at the end of March. But whether Yahoo could possibly have anything in place to replace the results they get from Bing search would likely be a long shot.

Yahoo has apparently brought many of their top Yahoo executives onboard with the project with plans to see something within a three to four-month time period, which would put it after the current Microsoft contract expires. It remains to be seen whether Microsoft would even be willing to renew a contract on a month-to-month basis or on anything shorter than a year, if Yahoo is successful in creating their own search engine.

On top of that, there is also the fact that Microsoft also powers the international versions of Yahoo, leading to an additional complication with search algorithms in other languages. If Yahoo decides to create their own search engine, it’s very likely they would first start with English before expanding it to any other languages, making a Microsoft deal for those search results crucial. Google is the alternative, but it’s unclear if a Yahoo-Google relationship would be a possibility.

Mayer is clearly bringing Yahoo back to its familiar roots in search, something the company used to be well known for. But Yahoo’s own history as a search engine has been varied. Once powered by Inktomi, Google then powered Yahoo search results in the early 2000s until 2004 when it began implementing its own search technology for search results. However when Carol Bartz became CEO, she jettisoned Yahoo’s own search technology in 2009 in favor of the contract with Microsoft.

Another issue with Yahoo potentially starting its own search engine again is that Yahoo currently receives 31 percent of its revenue from its search deal with Microsoft. Any change to that deal would definitely make shareholders uneasy unless Yahoo can make that much money independently from Microsoft.

It’s also complicated by the fact that Yahoo no longer runs its own self-serve pay-per-click system to power search advertising, similar to Google AdWords and Bing Ads, although they did previously have that technology. Those search result ads are also displayed through Bing Ads and is part of the search deal.

When the search deal expires at the end of March, we’ll likely get a better idea of where Yahoo is going with their own search engine, based on if it is renewed and on what terms. Considering Mayer’s Google roots, it isn’t surprising that Mayer wants to explore Yahoo becoming its own search engine once again, and being able to have more active control over it.

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